Britain’s exit from European Union (EU) will have negative consequences on Nigeria’s economy as it may affect 25-billion-dollar UK investment target in the country by 2020, a report by EXX AFRICA says.
EXX Africa in its report analysed the impact of an eventual Britain’s exit (Brexit) from the EU on three of UK’s most important African markets namely Nigeria, South Africa and Kenya.
It explained that the Brexit also threatened over 1.4 billion-dollar UK investment in Nigeria and the UK-Nigerian 21-billion-dollar annual remittance.
The report stated that there was extensive trade and security cooperation between the UK and Nigeria likely to face several years of disruption as the UK leaves the EU.
It noted that “Nigeria is UK’s second largest export market in Africa.
“Bilateral trade between the two countries is currently worth 8.3 billion dollars and projected to reach 25 billion dollars by 2020.
“The UK is also Nigeria’s largest source of foreign investment, with assets worth over 1.4 billion dollars. Moreover, UK-Nigeria remittances account for 21 billion dollars a year.
“The UK is also one of the largest development assistance donors to Nigeria, although Nigeria is not as aid-dependent as most continental counterparts.’’
It stressed that UK’s economy was experiencing slow down on the back of a departure from the EU.
It noted that the economic potential disruption as the UK renegotiate its trade agreements would likely reduce trade flows, foreign direct investment and Nigerian remittances.
It pointed out that on June 24, Nigerian stocks ended a three-day rally, falling 1.4 per cent over worries of Britain’s vote to leave the EU.